The latest property report from the Landmark Information Group looks at the complexities of the housing market and shares insights into the evolving dynamics of property transactions in England and Wales over a 15-year period, covering sales and purchases from 2007 to 2022.
Amidst the wealth of data collected, a key point is that buyers now face a staggering 80% increase in the average time taken from instruction to completion compared to 2019 (used as a benchmark, as this is a year considered to be free of anomalies). In 2019, the process took approximately 104 days, while in 2022, the timeline is currently 133 days (on average). A stark contrast when compared to 2007, where the same process was completed in a swift 75 days!
We consider the underlying factors contributing to the increasing property transaction times and how our team support our clients in navigating the evolving housing marketing swiftly and efficiently.
What’s causing the increase in property transaction times?
Buyers and sellers becoming risk averse
UK Finance reports that the average five-year fixed deal surged from 2.9% in June 2022 to 5.6% in October 2022, this is leading in a significant number of homeowners opting to stay put, resulting in a decline in the supply of homes available for sale. This decrease in houses available has resulted in longer and more intricate property chains, with a heightened risk of transactions falling through.
As mortgage rates continue to rise (read our previous article here) fewer people are able to access the right finance, and for those who can, a new mortgage offer can add weeks or months to the process.
Searches
Searches are regularly blamed for delays in the house buying process, however, this timescale has barely changed in the last 15 years, in fact the average time it took for a search to be requested and then received in 2022 was 15 days – 3 days less that in 2007.
Conveyancers should order searches as early as possible in the transaction process and not at the last minute to avoid chains breaking down.
Communication
Lawyers are also under increasing pressure to speed up the process, with slow enquiries and a lack of communication between lawyers contributing to delays, which can impact completion times by weeks or even months. These slow transactions also increase the risk of purchases falling through. Faster exchanges are needed, as is the need for lawyers and sellers to gather all necessary information and documents as early as possible to avoid further delays down the line.
Reduced transaction times and having all the material information as early as possible, is key to securing and pushing through sales, which is why, in April 2022, the National Trading Standards Estate and Letting Agency Team started the process of making it mandatory for property listings to disclose important information. They divided the disclosure into three stages and published Part A, which included details like price, tenure, shared ownership costs and council tax band.
The way properties are listed is set to change again soon, with Part C of NTS’s Material Information rollout, agents will have to inform potential buyers about any burdens or restrictions on the property.
Many law firms have invested in client onboarding technology to allow them to gather client information and documents at the point of instruction. However, this can lead to disparities in transaction processing times when some interested parties use automation and others do not.
PLG Clients
Despite the various housing market concerns and delays, our clients are often in a strong position. They are financially secure buyers, seeking lifelong homes, who for the most part, remain unaffected by falling prices and higher mortgage rates.
That said, buying a forever home that meets their complex needs is a crucial time, and one that our clients are keen to move through as seamlessly as possible.
We tirelessly search for properties that best meet these needs, and conduct viewings on their behalf, before reporting back with detailed summaries, that include information on location, care options, schooling and family dynamics.
Throughout the process we take immense pride in our efficiency when it comes to house buying transactions. From the initial identification of potential properties, reports, to skilfully negotiating successful transactions, We work diligently alongside all involved parties in the purchase or rental process. Our focus revolves around open communication and transparency, ensuring active involvement and the best outcome for our clients. By fostering close collaboration with estate agents and vendors, we maintain a seamless flow throughout the entire purchase journey to make it as swift as possible.
Phill Gill, Managing Director, says, “Our Property Finding team is made up of ex Estate Agents which means we have a clear understanding that getting a deal agreed is invariably only 40-50% of just what is needed to get a transaction over the line.
We recognise the importance of pushing transactions forward, securing agreements, and navigating the process with utmost efficiency. By working in collaboration with estate agents and vendors, we move sales on swiftly, to get our clients ‘home’.”